Published Paper Details:

Indian stock markets have seen unprecedented growth in the recent past. With increased development and growth, the patterns of foreign investment in the stock markets have also undergone significant changes. In this regard, the relationship between Foreign Portfolio Investment (FPI) or Foreign Institutional Investors (FIIs) is one that is increasingly being investigated by the academic community. This research paper focuses on analysing this relationship for a 15 year time period (2002-2017). The relationship between FPI and the returns on broad based market indices- SENSEX and NIFTY50 is analysed. The study makes use of ADF Unit Root Test, Correlation, Regression and Granger Causality Analysis for the purpose of determining the nature of association between the variables and the direction of causality. Upon analysis, this study reveals that FII flows have a significant impact on the stock market indices and there exists a uni-directional relationship between FII flows and SENSEX returns as well as NIFTY50 returns i.e. from FII flows to the index returns